Brinker International Earnings Preview

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Investors are on the edge of their collective seats, hoping that Brinker International (NYS: EAT) will top analyst expectations for the fourth consecutive quarter. The company will unveil its latest earnings on Wednesday. Brinker International owns, develops, operates, and franchises the Chili's Grill & Bar, On The Border Mexican Grill & Cantina, and Maggiano's Little Italy restaurant brands.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Brinker International with 11 of 19 analysts rating it hold. Analysts don't like Brinker International as much as competitor Buffalo Wild Wings overall. Ten out of 17 analysts rate Buffalo Wild Wings a buy compared to five of 19 for Brinker International. While analysts still rate the stock a hold, they are a little more optimistic about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $671.1 million in revenue this quarter. That would represent a rise of 2.5% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.27 per share. Estimates range from $0.20 to $0.32.

What our community says:
CAPS All-Stars are solidly backing the stock with 75.9% awarding it an outperform rating. The majority of the Fools are in agreement with the All-Stars as 66.3% give it an outperform rating. Fools are bullish on Brinker International and haven't been shy with their opinions lately, logging 172 posts in the past 30 days. Brinker International's bearish CAPS rating of two out of five stars falls short of the Fool community sentiment.

Management:
Brinker International's profit has risen year over year by an average of 26.7% over the past five quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q4

Q3

Q2

Q1

Gross Margin

73.1%

72.8%

73.3%

40.2%

Operating Margin

8.5%

8.5%

7.5%

4.9%

Net Margin

5.8%

5.6%

5.6%

3.3%

One final thing: If you want to keep tabs on Brinker International movements, and for more analysis on the company, make sure you add it to your watchlist.

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At the time this article was published

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